Corporates keen to maximise ROI via sports marketing

NEW DELHI: Sample some facts. The global sports sponsorship market in 2003 was worth $ 26.2 billion and the year on year growth has been eight per cent. In India, the total sports marketing and sponsorship is worth about Rs 8250 million. Of this sports advertising itself is worth Rs 4800 million, event sponsorship is Rs 2000 million and endorsement is worth Rs 900 million. Team sponsorships and innovations and ideas make up another Rs 550 million.

But a survey carried out by Relay, in association with Indiantelevision.com and Agencyfaq, highlighted that 83 per cent of the company-respondents had merely five per cent marketing budget for sports, which excluded buying TV spots and sponsorships. The barometer of corporate India’s optimism on sports and sports marketing did throw up interesting facts.

A modern day sport is certainly big business. And, it is apparent from the way ‘brands’ use sports stars to endorse their products. These days, sports stars are seen jostling for space along with Bollywood stars, endorsing various products, in several television channels. Therefore, it is now evident that the focus of businesses is to maximise returns through sports, since sports could pay also.

Still if industry folks --- sporting federations, advertisers, media planners, event managers and sportspersons ---- are to be believed a slew of questions, ticklish and otherwise, is haunting everybody. Foremost: beyond cricket what? Then there were other posers like: Has cricket killed other sports? Should corporate houses be more liberal with their support to indigenous sports and non-cricket games? Does the pubcaster has rights too lay claim on programming rights that are technically not its?

These and many other questions were discussed in a seminar on Business of Sports, SportzCom 2005, organised by the Confederation of Indian Industry (CII) here yesterday in association with SportzPR.

Experts were of the view that sports as a marketing tool has a great potential, but it is up to various stakeholders to reap advantage from it and learn from the best practices followed in different parts of the world. As International Cricket Conference’s global sponsorship manager, Jamie Stewart, said, “India is still at a nascent stage (in the sponsorship game).”

Though former Olympian GS Randhawa and the guest of honour for the day appealed that corporate bodies should come forward to adopt sports, especially non-cricketing ones, Stewart felt that the Indian sporting federations need to “stop appealing for charity” and start creating value for (advertising and marketing) partners.

The need of the hour could be an influx of corporate sponsorship in sports, but Chetan Madaya, GM of Relay India, a Starcom Mediavest Group company, felt that “sports is either big and too expensive or too small” for corporates and that if big time spenders are to be attracted to sports, choice has to be enhanced along with effectiveness for brands to flourish.

But when sports become too big and expensive, then, Mindshare GM Sundar Raman, pointed out, ROI is minutely seen. And, as most agreed, apart from cricket, very few games gave adequate ROI. The likes of tennis, golf and most recently F1 races may be some exceptions.

To a question as to why corporate houses only sponsor a sport where they can find adequate returns and before that they take into account the concerned athlete’s past performance, Kapil Dev said, "That is true, but in reality a corporate’s role comes into play when a player has reached at a particular level and is facing stagnation. At this point corporate sponsorship in needed to push him to the next level."

Amidst this cross-current of thoughts, Indiantelevision Dot Com Pvt. Ltd CEO and founder Anil Wanvari made an interesting point: broadcasters, like ESPN, need to adopt certain disciplines too for the development of that game. ESS’ adoption of Indian domestic hockey, through the Premier Hockey League, has shown that innovations can work.

“Once such a thing happens, then the possibility of local (sports) channels’ existence could give advertisers and marketers another platform,” Wanvari pointed out.

But are sportspersons equipped to handle this sudden razzle-dazzle, which sometimes go off the wire in a country like India? Wisden cricketer of the year and Indian legend Kapil Dev admitted that the pressure on sports celebrities was solely because they are not trained to handle media and the work-pressure.

This the corporates also admitted, pointing out that professional management of sports is the first step towards achieving success. But a more lively debate on the issue could not happen as political heavyweights — who also double up as sports administrators — failed to honour the organisers’ invitation extended to them. Except for All India Tennis Association, rest of the sports associations went unrepresented. And, herein lies another tale because in the Relay survey, most Delhi respondents felt that politicians were responsible in a big way for the lack of development of sports in India.

An apt summation came from sports commentator, former journalist and now a sports manager, V Krishnaswamy, who said that if a sport is not made interesting and cannot sell itself, then nobody and nothing can. Some of the other points that came during the almost day-long seminar were the following:

Corporates are looking long for term partnerships with sports and sportspersons.

Sports marketing is not just about sponsorship, but an evolving science to answer the hows, why and whens of the marketing game.

India definitely needs a comprehensive and integrated sports policy.

The government needs to increase its spending on sports.

Successful sportspersons and successful businesspersons have many things in common like goal setting, structure, competitiveness, ability to handle pressure situation and a focussed approach.

There was a need to understand sports as any other business and go in for de-risking factors.

Involvement of venture capital funds could be an option to develop financially under-supported games.

Cricket must work hard to keep its leading position amongst sports in India as it’s becoming too expensive for advertisers and marketers.

The best thing that could have happened to non-cricket games is cricket itself. Other sports could learn from the high and low points of cricket’s marketing.

Sports federations and marketers should look at developing properties that could give value to advertisers and sponsors.

For non-cricket games, it’s important to build value and trust for funding.

The cricket telecast rights tangle, akin to a “national soap opera” (in Venkateish’s words) needs to be sorted out fast.

Pubcaster DD is not looking at “deviously” getting telecast rights, but does not have the ability to bid and win rights as it survives on public funding.

Sports genre accounts for nine per cent of viewing time and 10 per cent of TV ad revenue.

Laws in India may be inadequate to sort out telecast rights tangle quickly.

Sports marketing’s definition varies.

Sports marketing presents five key ways for brands to harness the power of sports through association with tournaments as sponsors or partners, advertising in broadcasts, endorsements by sports stars, team sponsorships and innovative ideas like merchandising and appearances

Key drivers include advertisers gaining getting huge number of eyeballs.